Estimating your Process Projects presented at FSOkx BPM Forum
Description
Estimating always presents challenges. This is especially true when estimating the intangibles of process improvement efforts. This presentation will focus on how to reduce the guesswork associated with the estimation process by considering the following questions: What is it that you are estimating? How big is the thing you are estimating? What baselines are you using for your estimates? Should you be estimating top down, bottom up or somewhere in between? How do your estimates tie to your project plan? Do your estimates reflect ROI and business value?
Transcript
Estimating your Process Projects
FSOkx BPM Forum: September 17th, 2013
Matt Yeager
Manager, Advisory & Consulting
myeager@prolifics.com
Office: 646-380-2972
Anant Gupta
Senior Vice President, IBM Solutions
agupta@prolifics.com
Office: 646.201.4960
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• Los Angeles
• San Francisco
• London
• Hamburg
• Hyderabad
• Calabasas
• New York
• Boston
• Philadelphia
• Washington DC
• Orlando
In business for over 35 years, Prolifics is a Global Technology Consulting company with 1300 employees
worldwide specializing in the expert delivery of end-to-end Solutions utilizing IBM, Microsoft and Open
Source technologies.
Who Are We?
Our Vision
To be one of the most admired global technology consulting companies, delivering competitive advantage to our
customers through value add solutions.
Our Mission
Our mission is to be a trusted technology advisor and provide superior, specialized solutions to companies seeking
high value from their technology investments.
Prolifics at a glance
FY 2012: $105M
35 years of continued growth
Over 350 customers
including over 150 of the
current Fortune 1000
companies
Over 400
technical certifications
SkillsRevenue Customers
Services across the full project lifecycle
including advisory services, architecture,
business analysis, design, development,
testing, training, support, and system
administration
End-to-End Services
from Thought to Finish
Partnerships &
Processes
Company Snapshot
4
Why are we here…
Estimating always presents challenges
The intangibles of a process effort can be hard
to pinpoint
Reduce the guesswork associated with the
estimation process
5
Why are Process Projects so Hard to Estimate?
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Intangible
Ambiguous
Invisible
Lack of Understanding
Start?
End? End?
Evolves
System
Let’s Dive In…
What are you estimating?
How big is the effort?
What baselines are you using?
Can you keep to your estimates?
Are you achieving ROI and business value?
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Prolifics BPM Delivery Framework
Discover
Review / Develop
Organization
Strategy
Assess People
and Culture
Define Business
Architecture
Document
Technical
Architecture
Prepare Action
Plan
Scope
Facilitate Scoping
Session
Document
Problems with
Current State
Define Process
Vision
Identify Candidate
Project(s)
Clarify
Model As-Is
Process
Document
Business Rules
Perform Problem
Analysis
Define Data & Key
Performance
Measures
Define Roles and
Responsibilities
Identify Tactical
Opportunities
Develop Business
Case for Change
Design
Model To-Be
Process
Build Gap Model
Conduct
Innovation
Workshop
Perform
Organizational
Impact Analysis
Realign Incentives
to New Process
Define Quick Wins
(Low Hanging
Fruit)
Define Business
Requirements
Identify
Technology
Opportunities
Produce
Cost/Benefit
Analysis
Implement
Develop
Transformation
Plan
Define
Implementation /
Work Plan
Implement New
Roles/ Org
Structure
Define / Update
Policies &
Procedures
Implement Manual
Process Changes
Apply Process
Automation
Implement
Business Rules
Management
Monitor and
Control
Monitor On-Going
Process
Performance
Identify
Improvement
Opportunities
Frame
your
Estimating
Do Discovery BEFORE Estimating
Do Not rush Discovery…it is too important
Understand your organization's strategic vision
Determine if your culture and resources are accepting of change
Define and document your business architecture
Socialize your project and gather feedback
Analyze project risks
Formulate an action plan
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Process Scope
Diagram
Controls/ Constraints
Enablers
Outputs
Inputs Business
Process
Milestones/
Activities
Things that
govern or dictate
how a process
performs
Things that
enable a process
to be performed
Things
produced
by a
process
Things
that
initiate a
process
(Business Rules, Regulatory
Requirements, Laws, etc.)
(Work Products,
Transformed Data)
(Business Events/
Triggers, Data,
Inputs from other
Processes)
(Roles, Systems, Organizations, etc.)
Understand Process Project Types
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Discover
Review / Develop
Organization
Strategy
Assess People
and Culture
Define Business
Architecture
Document
Technical
Architecture
Prepare Action
Plan
Scope
Facilitate Scoping
Session
Document
Problems with
Current State
Define Process
Vision
Identify Candidate
Project(s)
Clarify
Model As-Is
Process
Document
Business Rules
Perform Problem
Analysis
Define Data & Key
Performance
Measures
Define Roles and
Responsibilities
Identify Tactical
Opportunities
Develop Business
Case for Change
Design
Model To-Be
Process
Build Gap Model
Conduct
Innovation
Workshop
Perform
Organizational
Impact Analysis
Realign Incentives
to New Process
Define Quick Wins
(Low Hanging
Fruit)
Define Business
Requirements
Identify
Technology
Opportunities
Produce
Cost/Benefit
Analysis
Implement
Develop
Transformation
Plan
Define
Implementation /
Work Plan
Implement New
Roles/ Org
Structure
Define / Update
Policies &
Procedures
Implement Manual
Process Changes
Apply Process
Automation
Implement
Business Rules
Management
Monitor and
Control
Monitor On-Going
Process
Performance
Identify
Improvement
Opportunities
Prolifics BPM Delivery Framework
Estimate
Modeling &
Design Based on
Scope
Clarify What You’re Estimating
Estimate the current-state and the
“to-be” process/sub processes
This will serve as the blueprint for
the project
Modeling the full end-to-end process
Focus on the “what” not the “how”
Capture enough information to gain
process awareness
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Estimate ALL Framework Components
Business Rules
Data & Key Performance Indicators
Changes to Roles & Responsibilities
Time for Creativity workshops & Brainstorming new ideas for
process improvement
Organization impact (time with Human Resources)
Explore technology options
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Focus Your Efforts
Use process maps to further scope the project’s level of effort
Conduct a gap analysis
Identify stakeholder involvement
Determine span of process control
Does the process cross departments or business partners?
Does the change impact organization structures and roles?
Does it require new technology or changes to existing?
Is training needed, how long will it take to develop and deliver?
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What to Consider for your Baseline Estimate
Do you have a basis from another successful process project?
Have you considered the time it takes to get accurate estimates
from business partners?
Can you demonstrate that your estimates are based on facts?
Have you been honest with how long it takes to change the
culture, gain leadership support and identify changes in roles?
Have you estimated in appropriate time for the following:
Project ramp-up, closure, training, deployment and warranty
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Common Pitfalls when Estimating
Scope is to narrow or vague
Additional funding is needed to continue the effort
Focus is solely on the selection and purchase of a technology
Does not include cross-department involvement from subject
matter experts, which is needed to capture a full end-to-end
process
Adequate time is not spent identifying the ROI, business value or
customer needs
Not enough time spent understanding the business rules/decision
management associated with their processes
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How many of you consider
business rules / decision management
when estimating your projects?
How can we ensure that business decisions are managed
in a controlled environment?
Governance
How can we ensure the right decision is being made at the
right time?
Visibility
Key Challenges Addressed by Decision Management
How can we rapidly respond to evolving market demands,
competitive actions and regulatory requirements?
Collaboration
Discover
Review / Develop
Organization
Strategy
Assess People
and Culture
Define Business
Architecture
Document
Technical
Architecture
Prepare Action
Plan
Scope
Facilitate Scoping
Session
Document
Problems with
Current State
Define Process
Vision
Identify Candidate
Project(s)
Clarify
Model As-Is
Process
Document
Business Rules
Perform Problem
Analysis
Define Data & Key
Performance
Measures
Define Roles and
Responsibilities
Identify Tactical
Opportunities
Develop Business
Case for Change
Design
Model To-Be
Process
Build Gap Model
Conduct
Innovation
Workshop
Perform
Organizational
Impact Analysis
Realign Incentives
to New Process
Define Quick Wins
(Low Hanging
Fruit)
Define Business
Requirements
Identify
Technology
Opportunities
Produce
Cost/Benefit
Analysis
Implement
Develop
Transformation
Plan
Define
Implementation /
Work Plan
Implement New
Roles/ Org
Structure
Define / Update
Policies &
Procedures
Implement Manual
Process Changes
Apply Process
Automation
Implement
Business Rules
Management
Monitor and
Control
Monitor On-Going
Process
Performance
Identify
Improvement
Opportunities
Not Just Implementing
Technology
Prolifics BPM Delivery Framework
Do Not Underestimate Implementation
Changing people’s roles and organizational culture
Reorganizing around process-oriented business model
Modifying policies/procedures
Selling Process Change
Can be It’s own phase…
Training
Can take significant time to prepare and deliver
How will training be delivered?
Are resources geographically dispersed?
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What Type of Implementation?
Big Bang
Could require less time, but much greater risk
Parallel Transition
Running parallel processes for a time, more cost but less risk
Pilot
Could require more time, but lower risk
Step Change
Phased implementation (e.g. regions, states, etc.)
Requires more time, but much less risk than Big Bang
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Measure Success Against your Estimates
“When you can measure what you are speaking about and express it
in numbers you know something about it;
but when you cannot measure it, when you cannot
express it in numbers, your knowledge is of a
meager and unsatisfactory kind.”
- Lord Kelvin
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ROI cannot be
demonstrated
without proper
measures…
Monitor KPIs and ROI Example
Total annual savings = $1.3m
Risks and Challenges of Estimating ROI
Risks
Over estimating potential
savings
Setting unreachable goals
Addressing business value that
isn’t aligned with the
organization’s current vision
Belief that true ROI is only
achieved through headcount
reduction
Challenges
Factual estimating takes time
All estimates will be questioned
Ability to measure, monitor and
demonstrate ongoing savings
Savings may be inconsistent
Continued leadership
dedication and support is
needed
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Ramification of Poor Estimating
Project fails or ends before needed improvement is achieved
Loss of customers and revenue
Unable to meet regulatory or compliance demands
Critical or adverse events such as..
In health care, process failure results in patient injury or death
In finance, poor estimating results in lack of detecting fraud
and potential loss of customer money/investments
Lawsuit and damages paid to affected customers
Your business is sold or closed!
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ESTIMATING MY
POOL PROJECT
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How I Approached Estimating
Documented my scope - what is needed vs. what is a nice to have
Obtained bids with detailed cost information for each item/task
Created a baseline estimate based on scope and bids
Consulted colleagues, friends and family members with pool
Finalized scope and budget projection
Obtained Executive (aka. My Wife!) approval and secured funding
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What Return on Investment & Value Will I Get?
Limited return on investment since a pool won’t significantly
increase my property value
Ongoing costs will be associated with maintenance, repairs and
increased electric, gas and water bills
Value is achieved when…
Wife and Daughter - my “customers” are happy and relaxed!!
The whole family is outside more (away from TV/iPads)
Daughter is part fish and loves to swim
Family and Friends will want to come and stay at our house
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Visualize Your Goal!!
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http://www.hearstcastle.org/
Closing Comments
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Remember, Estimating Change can be Hard!
Only change what is needed to address the business problem
Don’t boil the ocean
Only model to the level of detail necessary to understand and
address the problems
Address the most critical issues first, weakest link in the chain
• Goldratt’s Theory of Constraints
Estimate based on the process and what is factual
‘Process reengineering’ should be the exception
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Why you need Comprehensive Estimating
Dedicated focused team
Have Leadership support
Time needed from other departments
Project is phased appropriately
Understand the technology needs
Understand clearly what your scope is for the project
Documented current and future state process models
Attainable and stretch goals set for ROI and business value
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Relax and Get Estimating!!
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